In 2016 Amazon had a net sales revenue of $136 billion (up from 7 billion in 2004) for its wine selling. Despite the great success, the online sales company is scheduled to drop this service before the end of this year. This is not, however, an unexpected exit from the wine world. The group strategy is part of a larger approach related to the recent acquisition of Whole Foods, which already sells wine. The objective seems to be to avoid scattering offerings among different channels.
Wine selling will continue through Amazon Fresh, Prime Now, and Whole Foods. A legal issue comes into the picture too. Amazon Wine functions as a platform for consumers and wine producers that have specific licenses, and Amazon receives a commission on sales. This practice is not permitted in some American states. Competition for online business is strong, with other companies such as Deliveroo and Uber playing an important part in beverage home delivery. Amazon Wine’s exit is more like a new beginning in their overall commercial strategy.